E & OE…………………………………………………………………………
Subjects: GST; newspoll; ACCC; overseas trip; Kerry Chikarovski; cricket
LIEBMAN:
Prime Minister good morning to you.
PRIME MINISTER:
Good morning Steve.
LIEBMAN:
I want to come to the report, so-called secret report in a moment, but overnight cabinet reaffirmed your decision. That’s it, it’s final.
PRIME MINISTER:
In relation to caravan parks.
LIEBMAN:
Yes.
PRIME MINISTER:
Yes, and the reason we’re not changing is that if you took the half-GST off caravan parks the rents for those residents would still rise by a comparable amount. And Peter Costello last night released some research done by an independent economic body which demonstrated that point in relation to boarding house accommodation and their situation is broadly comparable to those of residents. What people forget is that if you don’t charge the half-GST then the landlords, as the operators of the caravan parks, can’t get refunds of the taxes they pay on their input costs and therefore to recoup those taxes they will put up the rents. So I mean people are not going to be better off, they’ve been misled into believing that if you got rid of it you’d be better off and that’s the reason why we’re not going to change it.
LIEBMAN:
OK if as you say caravan park dwellers are not going to better off, or wouldn’t be better off if you took that half-GST tax away why not take it off, and if they’re worse off and they come knocking at your door say listen well don’t blame me you wanted it.
PRIME MINISTER:
Well Steve because many of these caravan parks you have a mixture of short and long term residential stayers and we introduced the option of either input taxing or a half-GST in order to ease compliance costs in relation to the operation of the tax. Now we have been constantly told, and quite rightly by many people that you’ve got to try and keep compliance costs down, but we are quite satisfied , quite satisfied, that either way the outcome is essentially the same and indeed in relation to boarding houses the research that Peter released last night shows that in the longer term you’re much better off with a part-GST.
LIEBMAN:
He was forced to release that information last night because Labor is claiming and the report was leaked, that the economic modeling firm Econtech had established that you misled voters over the tax package’s impact on the disadvantaged. You’ve obviously already indicated that you haven’t, but will you allow the full report to be released so that the electorate can decide.
PRIME MINISTER:
I personally have not seen that research, I haven’t read it, but I am satisfied that the material that we provided at the time of the election and continue to provide which has been done by the Treasury and so forth is bona fide material. Steve we are in at the moment the easy hit stage of this tax debate for the Labor Party. The Labor Party can say anything and then run onto the next. I mean they’re having an easy time at the moment. And of course there’s nervousness and apprehension. It’s only eleven days, it’s the greatest tax change in Australia’s history and people are understandably waiting to see. And there’s a certain apprehension, I understand that, I am doing my best to respond but it will be impossible to allay those concerns until it actually comes in and people will go into the shops and they’ll find that the price of some things have gone up, some remain the same and some have gone down. And when they actually receive tax cuts, and when the low income renters get a 7% increase in their rental allowance which will more than cover any increases in boarding house or caravan park rents. People will then begin to see the equity and the balance and the fairness of this taxation reform, but right at the moment the Labor Party’s having a field day. It’s easy game at the moment. The easy hit stage of politics. Easy to be negative, easy to instill fear into people. Of course it is, but we are introducing tax reform, not for our political health, but for the long term benefit of Australia.
LEIBMAN:
I understand that, but the reality is on the caravan tax alone you could lose the election.
PRIME MINISTER:
Well Steve, the reality is that the election is at the end of next year and when people have had an opportunity of experiencing the new arrangements they will make their own judgements as to whether this is good for Australia. And I am quite happy to accept that judgement. It may be adverse . . .
LEIBMAN:
Ok.
PRIME MINISTER:
I don’t believe it is, but you’ve got to do things that you believe are good for the country and not for your short term political health.
LEIBMAN:
Prime Minister, support for you and your Government according to a poll in the Australian today is the lowest it’s been since the last election. Big and small business is nervous. The electorate is becoming increasingly GST jittery and you announced last night that as well as being out of the country when the GST comes in, after your trip to London you are now visiting India. Don’t you think it would be smarter to be in the country?
PRIME MINISTER:
Well I will be in the country when the GST’s introduced. I am not leaving Australia until three days after it’s introduced. I will be here the weekend it is introduced and it seemed to me far more sensible to spend two days in India on the way back from London then undertake a separate trip to India before the end of the year. Steve, I’m amazed at the attack that the Labor Party is mounting on the fact that I am, apart from the historical significance of the visit to London, Britain is Australia’s largest foreign investor. In the four years that I have been Prime Minister I have undertaken one bi-lateral visit to Britain, in the same time I’ve visited Japan on three occasions and the United States twice. Now it’s, once again it’s easy politics, but Steve in the end it is the quality of what you do. Sure we’re doing bad in the polls at the moment, but I fully expected that. If the Labor Party can’t be ahead at the moment, they’d be a fairly poor opposition because we are suffering all of the natural jitters that people have before a big change.
LEIBMAN:
Ok, a couple of quick ones. Are you considering restricting the ACCC’s power to shame businesses suspected of GST exploitation.
PRIME MINISTER:
Well, I’ve not had any discussions with the Treasurer about that. I read that in the paper this morning, it’s news to me.
LEIBMAN:
Well what do you think of the proposition?
PRIME MINISTER:
Well I think there’s a role for the ACCC. I think the ACCC is seen as a friend of the consumer. I understand some businesses get tense about the activities of the ACCC, on the other hand, there are some people who will try and take advantage of the big tax change and we’ve got to strike a balance. We’re in there batting for the consumer as well as for business.
LEIBMAN:
Kerry Chikarovski’s position as New South Wales Liberal Leader’s going to be challenged today. Do you have a message for your Liberal colleagues in New South Wales?
PRIME MINISTER:
Well obviously the sooner the issue is resolved the better. I don’t see any, I don’t see any alternative on the horizon to the present arrangement. I know how difficult it can be leading an opposition – I’ve been there, done that, been through all of that. But from our point of view, it is obviously better if the matter is resolved and I hope it is. But I understand the difficulties and I don’t like giving gratuitous advice.
LEIBMAN:
One final question – put your cricket tragic hat on. Are you fearful of what the Cronje inquiry is going to reveal from here on in and its possible implications for Australian cricket?
PRIME MINISTER:
Well maybe I am being naïve, but I’ve got a lot of faith in the people who’ve worn the baggy green. I would, I would be devastated if that sort of behavior were to be revealed about Australian cricketers, I hope and pray it isn’t. It’s difficult for the game at the moment, but it will survive because there’s more to cricket than the behaviour of some people.
LEIBMAN:
I hope you’re right, thanks for your time.
PRIME MINISTER:
Good.
[Ends]